Jan 04, · If you buy Bitcoins from an exchange like Zebpay or others, your money goes to the exchange. However, if you buy it from a holder of bitcoin by transfer of his bitcoin from his wallet to your wallet, your money goes to him as decided between both of you. K views View 1 Upvoter. Dec 07, · When I saw the price of bitcoin fall to $9,, I pressed buy, defying the wisdom of two finance titans and my wife. One hundred dollars, or bitcoins. (A . Jul 29, · When you purchase Bitcoin from a third-party cryptocurrency exchange, the funds will initially be placed in your web wallet.
When you buy bitcoin where does the money goI bought $ in bitcoin. Here's what I learned
According to financial services company Fundera, around 2, U. More than a dozen multinational companies also accept bitcoin.
Slam-dunk proof of increasing utility, right? Not so fast. There are not nearly enough tokens in existence to drive widespread adoption, based on these figures.
As one additional note, there are about Removing these nonemployer businesses leaves 7. Census Bureau in According to Fundera, just 2, of these businesses are accepting bitcoin. Bitcoin bulls are also pretty convinced that the most popular digital currency is now a bona fide store of value: i.
When coupled with the central banks' pledge to keep its federal funds rate at or near record lows, it's pretty evident that the U. Crypto investors believe that a ballooning money supply is a green flag for bitcoin to head significantly higher.
The issues I have with the store-of-value thesis are twofold. First, bitcoin isn't backed by any other asset or government. Therefore, it has no tie-ins or official relationship to the movements of the U. Implying that a ballooning money supply should push bitcoin higher is nothing more than a dart throw.
Second, store-of-value assets are designed to maintain their value over time and protect investors from volatility. Yet in March, bitcoin nearly lost half of its value in a hour period. In , bitcoin lost about half its value in about six hours. This isn't how a store-of-value asset behaves. Bitcoin optimists will also crow about bitcoin leading the digital payments revolution. Going cashless could resolve the issues created by certain regions of the world being underbanked. Additionally, the blockchain technology that underlies bitcoin could revolutionize the payment processing and settlement time frame, especially in cross-border transactions.
While I don't disagree that a digital payments revolution is underway, or that blockchain could offer global financial and supply chain solutions, bitcoin isn't the vessel that's going to make this vision a reality. Unlike eggs, however, there is a fixed limit of 21 million bitcoins that will ever be created, which makes them relatively scarce, and helps give them value. Sign up to join this community.
The best answers are voted up and rise to the top. Where do the dollars go? Ask Question. Asked 8 years, 5 months ago. Active 3 years, 6 months ago. Viewed 42k times. Active Oldest Votes. When you buy a bottle of soda at the convenience store, where does the money go? Bitcoins are like a commodity that works the same way. Stephen Gornick Stephen Gornick So in the case of an exchange like Coinbase, do they hold a "pool" of Bitcoin that they hold and sell to people?
Chris Moore Chris Moore Heh, this is a great way of explaining it! Chris How does this work in the case of exchanges like Coinbase? Directly to people who are currently selling if you don't count the minor exchange fees. The Overflow Blog. Podcast What can you program in just one tweet? Ciao Winter Bash ! Bitcoin has progressed enough as an industry that in a matter of minutes, you can own bitcoins that can be used as currency or an investment. Before you acquire bitcoins, though, you'll need somewhere to access them.
That's where a bitcoin wallet comes in. A bitcoin is not actually a tangible "coin," and they're not something that can technically be stored. So, fittingly, a bitcoin wallet is not an actual wallet, something you can keep your bitcoins in and then attach to your jeans with a bitcoin wallet chain. What is a bitcoin wallet? Essentially, it is a public key and a private key, each of which makes buying and selling bitcoins possible.
Because it is basically just a series of keys, there are a wide variety of bitcoin wallet types with varying levels of security.
All of them have their pros and cons. The most convenient ones for casual bitcoin buyers are online wallets and mobile wallets. These allow for quick and easy access to bitcoin, but also puts your money in the hands of a third party and storing it in a cloud-based system. The best online wallets are fairly secure, but stay cautious regardless. Coinbase is arguably the most popular bitcoin wallet, period. An online wallet with a mobile app, it's seen as the most convenient because it is also directly connected to a bitcoin exchange, simplifying the buying and selling processes This is also true of another popular wallet, Blockchain.
Coinbase also offers offline storage for added security. These and other online wallets have mobile apps as well, but there are also many wallets designed specifically for smartphones. While this means you can access your bitcoins anywhere you go, if your phone gets hacked, those coins are in danger of being lost to you forever. Still, mobile apps are convenient, and the more successful ones have their own ways of working to secure your information.
Airbitz client-side encryption and Mycelium open protocol are two particularly successful mobile wallets that have focused on security.
Hardware wallets are a more secure bet for your bitcoins, especially if you're using them as an investment instead of spending them. Hardware wallets, aka wallets on a secure device, are the safest option; the drawback is that unlike popular apps and software, hardware wallets cost money. Still, if you have some extra money and want to do your best to ensure safety, hardware is a solid bet.
Trezor , for example, is a hardcore wallet that offers 2-factor authentication AND a password manager, while the popular Ledger wallets require a PIN code for access. Software wallets aren't quite as secure; if a hacker gets your computer, they could steal your bitcoins.
But if you stay vigilant about keeping your computer safe and malware-free, you could do far worse than a software wallet right on your desktop. Popular ones include Electrum which has decentralized servers , Copay which lets you store multiple wallets , and Jaxx which can be used with many different cryptocurrencies.
Paper wallets are interesting. In theory, they should be more secure than any wallet - it's a piece of paper with your public and private keys printed on it, so it's not getting hacked into. Scan the printed QR codes onto an online or software wallet, and you can use them. But there are other risks - like losing it, or someone stealing it from your home, or just spilling water on it.
Be careful with paper wallets. Keep them tightly sealed. Fold it in a way where the private key can't be seen. Print it in a secure manner, such as via a USB on a printer not connected to a network. There are several services out there that will generate a paper wallet for you to print. None of the wallets I've brought up are mentioned as recommendations, merely as examples of what is out there. Your own research will provide you with the choice that's best for you.
Once you have your wallet, you have someplace for your bitcoins to actually go to. Being able to connect your credit or debit card to your wallet is a convenient way to get it done quickly.
But it may well depend on what bank and card you use to determine if you can do it.